PAYO launched its new cash-on-delivery (COD) management platform last February 20, 2018 in a bid to help simplify and improve the productivity of online businesses in the Philippines, enabling them to fully take advantage of e-commerce.
E-commerce is rapidly growing in the country, due in part to Filipinos being online an average of 8.5 hours a day, with four hours and 17 minutes spent on social media platforms. Around 33.3 million of the population is connected through smartphones while a larger 69 million are active internet users. This gave way to a total of USD 1.5 billion in e-commerce revenue last 2016.
Ofri Kadosh, co-founder and CEO of PAYO noted that local merchants have to integrate COD as a payment option in their business models given that 93 percent of Filipinos still prefer to pay cash when buying online. A measly eight percent carry credit cards, while 72 percent do not even have bank accounts.
“We know the struggle of businesses operating in the e-commerce space and what they have to contend with particularly when it comes to integrating cash-on-delivery in their payment process. One of the main challenges are order cancellations, which happens to about 30 to 35 percent of their transactions. For merchants, this means an automatic loss of revenue,” said Kadosh.
PAYO developed the platform to allow both merchants and consumers to experience better and faster COD transactions. It works as an interface that can be integrated into the merchant’s online shopping carts. Once the consumers start placing orders, data scientists will then process the sale as well as record and analyze their order histories.
The data analysis builds credit history for COD consumers and employs fraud detection to isolate potentially problematic accounts which minimizes cancellation rates even before the orders leave the warehouse.
PAYO’s solution also includes courier optimization algorithms to select the most convenient and practical courier service to use from PAYO’s pool of trusted partners which includes LBC, 2GO, Black Arrow Express, Ninja Van, Honestbee, Zoom, Lalamove and Dalasia.
PAYO can also streamline the process of tracking orders and communicating with customers for updates on their orders. Once the delivery is completed, the service monitors money collection and remit the payment to the merchant.
Data insight collected from deliveries are also used to ensure immediate remittance, allowing merchants to manage cash flow and scale up their business faster.
PAYO was initialized last December 2016 as a solution developed for HLM, an e-commerce platform and call center business founded by Kadosh and his business partner Liron Gross, who serves as PAYO’s COO.
The company continues to gain traction, handling COD transactions for large brands like National Bookstore, Sunnies and Sole Academy.